Occasional random comments from a father of four.
"If it wasn't hard, everyone would do it. The hard is what makes it great." Jimmy Dugan (Tom Hanks) in A League of their Own

16 August 2009

Why does health care cost so much in the US?

That's the question I typed into Google. About halfway down the results page I found this article from the NYTimes Bizness section.

Compared to other countries, health care is more expensive here. We knew that. Health care expenditures per capita seem to be closely related to GDP per capita - so countries with more money spend more on health care - makes sense.

But that doesn't account for the discrepancy in the US. We pay more here for

" factors other than G.D.P. per capita. Prominent among these other factors are:

1. higher prices for the same health care goods and services than are paid in other countries for the same goods and services;

2. significantly higher administrative overhead costs than are incurred in other countries with simpler health-insurance systems;

3. more widespread use of high-cost, high-tech equipment and procedures than are used in other countries;

4. higher treatment costs triggered by our uniquely American tort laws, which in the context of medicine can lead to "defensive medicine" — that is, the application of tests and procedures mainly as a defense against possible malpractice litigation, rather than as a clinical imperative."